Quote from: Stablexcoin on May 14, 2024, 01:35:48 PM

Quote from: Alphakilo on May 09, 2024, 08:35:52 AM

Wealthy people love debt. Unlike the poor people who just want to get out of debt as fast as possible, the wealthy are looking for more ways to increase their debt. In school I was taught that there are two types of debt the good debt and the bad debts.

Wealthy people are in the good type debt. Good debt is money borrowed to invest in a business like real estate , restaurants, or property whose value will bring in more money than the debt. However bad debt is there borrowed to buy liabilities. This is where the wealthy are smart. Their debts are the good kind of debt that increases their wealth despite being in debts.

As my economics professor would say, Using someone else's money (debt) to increase your own wealth is a skill the wealthy have mastered.

Wealthy people do not fear debt instead they see debt as a means to get more money. Some poor people understand the concept of debt but are afraid to take one since they do not have collateral or a big business that can provide back such money they borrow if things go wrong in the investment or business. Another point is that the bank grant loans to wealthy people believing they are capable of paying the debt while they refuse to loan the poor because they have nothing. There are benefits that comes to an individual when he is rich that he didn't work for.

I think wealthy people are wise because they know how to use debt and how to double and triple your money . In comparison, poor people take loan for only useless thing . They have no business plans but they want only security in life. But businessmns take calculated risks and they make assets and then they get multiple returns on investments and they pay debt in 20 to 30 years of time. I think rich people are rich due to not only having money but they are rich due to mindset of rich people.Rich people invest in their businesses and they buy commodities and then they sell these commodities on high price. They take steps and they take risks . Everyone can't do this.